Injunction against winding-up petition refused

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2 min read

An architectural consultancy had a statutory demand served on it by its subcontractor for unpaid invoices. The architectural consultancy had two directors, but one director (second director) had no day-to-day involvement in the company following a falling out with the other (main) director.

Before presenting the statutory demand, the subcontractor approached the second director regarding the unpaid invoices. The second director allegedly stated that the subcontractor was likely insolvent. The subcontractor then served a statutory demand on the architectural consultancy. The main director provided the statutory demand to solicitors who contacted the subcontractor stating they were instructed by the main director “in his capacity as director” of the architectural consultancy.

The solicitors also issued a court application to restrain the imminent presentation of a winding-up petition by the subcontractor. This application stated that the solicitors acted for the architectural consultancy (not the main director). The second director learnt of this and emailed the solicitors stating, in his capacity as “co-director”, he wished to disinstruct them.

The court determined that the application should be dismissed. The directors of the architectural consultancy had to act in accordance with the company’s articles of association. This required the directors to be in agreement to instruct the solicitors to file the application. No such agreement had been reached. It was irrelevant that the second director had stopped taking a hands-on role in the company, he was still a registered director of it. 

Rushbrooke UK Ltd v 4 Design Concepts Ltd [2022] EWHC 1110 (Ch)

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